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Questions and Answers
Here are some questions our customers have asked us about the new competitive energy market:
What is good about electricity competition?
Competition will encourage new ideas and technological innovations and make it possible for new companies to enter the electricity business. This in turn should offer customers better products and services as well as a variety of new pricing options. It may be difficult to identify the benefits in the short term because of potential price fluctuations, but over time deregulation should strengthen the electricity industry across the province, including improving our environmental performance.
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What is unbundling?
Cambridge and North Dumfries Hydro Inc. presently buys generation and transmission services on behalf of its customers. Up until last year, the charges for those services were bundled together and shown with your energy charge as one single charge. In preparation for deregulation, we have started to show some of these charges separately on your bill to help you track your usage and make better energy management decisions. Once Market Opens on May 1st, 2002 your bill will be fully unbundled. It will allow you absolute price discovery for comparison of the energy cost - the only competitive piece on your bill.
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When does retailer choice begin?
Energy retailers have been knocking on doors and signing up customers for the past year. If you signed up with a retailer before market opening date, May 1st, your contract for that energy or commodity won't begin until after the market opens. If you choose not to sign a contract with a Retailer, Cambridge and North Dumfries Hydro Inc. will continue to supply you with electricity. You can take your time and shop around, compare offers, ask questions about the terms of service, and then make a decision as to whether or not you want to switch. There is no deadline for making a decision.
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What is the Energy Charge?
This includes the actual electrons cost of generating the electricity.
In addition to the energy charge for the electricity you consume, (the competitive piece which accounts for about 45% of your bill), all electricity users will pay a local service and distribution charge and provincial market services charges including transmission, transformation and a debt retirement charge. (combined, these represent about 55% of your bill).
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Do I have to choose an electricity retailer?
No. While customers will be free to choose an electricity retailer, whether or not they actually choose to do so will be entirely up to them. Customers who don't choose an electricity retailer will continue to be served by Cambridge and North Dumfries Hydro Inc. The new market rules ensure that all local distribution companies across the province guarantee a standard level of service to customers who do not choose a retail supplier.
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What is the System Access Charge?
It's our fixed local monthly charge to cover our costs such as meter reading, billing and administration. This charge remains constant, no matter how much electricity you use each month. The Ontario Energy Board regulates our service charge.
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What do electricity retailers do?
Energy retailers contract for wholesale electricity as well as other products and services and retail them to customers. They may provide customers with a wide range of products, services, payment plans and other incentives, in addition to electricity. When you're dealing with an energy retailer, cost is often only one element of the total package. That's why it's important to shop around and compare the various options and terms available before signing a contract.
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What is a Distribution Charge?
This refers to the cost of designing, building and maintaining the distribution system that connects your home or business to the rest of the electricity transmission and generation system. Cambridge and North Dumfries Hydro Inc. will continue to perform distribution services under regulation of the Ontario Energy Board. In fact that is our business - "we deliver" the energy you need for all of the comforts of life.
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What should I know before I sign a retailer contract?
Before you sign a contract, read it carefully so you're aware of all of the terms and conditions. Ask questions if there is anything that is unclear, and ensure that the retailer is licensed by the Ontario Energy Board to sell electricity. Retailers are obliged to identify their licence number to their customers. If you are unsure, call the OEB at 1-877-632-2727 or visit the OEB web site at www.oeb.gov.on.ca. The website contains a list of all licensed retailers across the province.
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Can I be switched over to a retailer without my knowledge or approval?
No, a retailer cannot supply electricity to a customer without first obtaining the customer's written authorization.
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What questions should I ask to compare offers between retailers?
You will want to know:
- Whether the retailer has a licence from the Ontario Energy Board
- The price the retailer is charging for electricity. Make sure the price you are quoted is for the electricity only and also make sure you know what you are currently paying for electricity only. Until May 1, 2002 the charge for electricity on your utility bill is a bundled amount and includes other charges. You should check with your utility, to find out what the charge for the electricity is.
- The start date and length of the contract
- Whether the contract can be cancelled and if any penalties or service charges are involved if you do cancel
- The mix of energy generation sources the supplier is offering
- What obligations you and the retailer will have under the contract
- The company's background and business experience in retailing electricity
- Ask if the contract requires you to assign any future rights or refunds you may be eligible for. There is a potential for customers across the province of receiving what the government is referring to as a "Market Power Mitigation Rebate" - a rebate for their energy consumption over the year. Some retailer contracts contain a clause assigning that refund to the retailer.
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Does competition mean that each company will put up power lines?
No, it doesn't. Transmission and distribution of electricity will continue to be provided by regulated transmission and distribution utilities. It's just like long distance phone services - the wiring doesn't change. Cambridge and North Dumfries Hydro Inc. will continue to service the lines to ensure you are delivered a safe, reliable source of energy.
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Can I cancel a contract with a retailer once I've signed it?
Before you sign any contract, make sure that you understand the terms and conditions, as this will be a legally binding agreement. You should also ask for a signed copy of the contract. Remember that the contract will not be in effect until the market opens on May 1, 2002.
If you're a typical residential customer and you sign a contract, you have a 10 day "cooling off" period in which you can change your mind and cancel, in writing, without penalty. To do this, as a residential customer, you must send a letter by registered mail, fax, or by personally delivering it to give notice you want to cancel. Be sure to keep copies of everything you send for your records.
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Who will read and maintain the meters at my home or business?
Cambridge and North Dumfries Hydro Inc. will continue to read your meter.
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How can I tell if a retailer's prices are comparable?
The best approach is to compare offers from several retailers to determine what price and service options are best for you. But remember, competition and customer choice apply only to the generation segment of your bill. That is the electricity or commodity only. The rest is not subject to competition. It includes costs for transmission (moving electricity from where it's produced to the local distribution utility) and distribution (moving electricity along the wires to your home or business). The Ontario Energy Board regulates the distribution and transmission rates. There are also costs related to the debt the former Ontario Hydro accumulated under the old monopoly system. Your current electricity bill includes charges that pay off this debt, and this will continue in the competitive market, until the debt is paid off.
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Who fixes power lines if they fail due to weather or accidents?
The professional staff at Cambridge and North Dumfries Hydro Inc. will continue to maintain the electrical system, just as we have for 90 years.
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Is a fixed price a good thing?
A fixed price remains the same for the term of the contract. The energy rate you pay now on your hydro bill is fixed and the amount you pay changes as your consumption varies from month to month, season to season. This will change with the opening of the new marketplace. If you choose to do nothing, and stay with your local utility you are considered a Standard Supply Service (SSS) customer and the cost of your electricity will fluctuate based on the marketplace.
These prices will fluctuate and in periods of high demand for energy, may be volatile. Under Standard Supply Service, customers will be billed using the actual rate for electricity itself throughout the year. The cost of electricity changes hour to hour and customers will be billed the average cost for that electricity for the thirty or sixty-day period their bill covers. Under the new regulations, Cambridge and North Dumfries Hydro Inc. will secure the electricity for the customer, without mark up. With a fixed contract price, you will know how much your electricity will cost throughout the year. Whether a fixed price under contract is a good thing for you - depends on your tolerance for risk. We liken it to having a fixed mortgage versus a variable mortgage that fluctuates. With a fixed contract the retailer is assuming some level of risk for price volatility and that is built into the contract rate.
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Who will handle any questions I may have?
For power outages, or issues related to power supply and delivery, you should contact the Customer Care Department at Cambridge and North Dumfries Hydro Inc. at (519) 621-3484.
For questions related to your electricity contract with a Retailer, contact your Retailer's Customer Service number that will be displayed on your utility bill. Keep notes of your actions, including the names of the company representatives you talk to. Follow up with a letter if you don't get satisfaction. If the problem can't be resolved, you should call the Ontario Energy Board at 1-877-632-2727.
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Why will my new bill after Market Opening have so many more line items?
The new improved unbundled bill that you will see sometime after Market Opening is a little more complicated. However, the bill has been redesigned to break down all of different components on your hydro bill. This extra detail will allow customers to make clear comparisons between suppliers when they are deciding who their electricity supplier will be. It is more complicated but it provides you with better information and allows you to compare "apples to apples".
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Can someone speak to our company or group about the competitive market?
The staff at Cambridge and North Dumfries Hydro Inc. actively participate in information sessions in the community. We are available to address classes, clubs, school groups, and business or residents associations on consumer choice or industry re-regulation. If you are interested in having someone address your group, please call Barbara Shortreed at (519) 621-8405 Ext. 2334. Or drop her an e-mail at
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Have a question we have not answered?
We are pleased you have taken the time to check out our website for answers to your questions. If you have a question we have not addressed, please call our Customer Service Department at (519) 621-3484 or send us an e-mail at:
. We want to provide good information to our customers about market opening and its impact.
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